November 26, 2024 – The Central Government plans to introduce the Banking Laws Amendment Bill 2024 in the Winter session of Parliament. This will bring in changes in the banking sector rules with a view to safeguarding the interests of account holders.

An important element of this Bill would be to increase the number of nominees allowed for a bank account to four. The current rule allows only one nominee per bank account. But once the Banking Amendment Bill is passed, it will become mandatory to have four nominees for an account.

According to reports, as of March 2024, there is an unclaimed amount of Rs 78,000 crore in banks, for which there are no claimants. The Ministry of Finance and the government are concerned about it. This amendment would ensure that the unclaimed money reaches the rightful heirs.

Other than this change, the government also wants to facilitate the transfer of unclaimed amounts - such as dividends, shares, interest and matured bonds - which have not been claimed for seven consecutive years, to the Investor Education and Protection Fund (IEPF). Investors will be able to claim the amounts or refunds from the IEPF.

Another amendment would be to allow directors of Central cooperative banks to work in State cooperative banks. The government is also looking to extend the tenure of directors of cooperative banks from eight years to 10 years.

Source: Media Reports